The short version: Corporation Tax is what limited companies pay on their profits. Unlike sole traders, companies don’t get a Personal Allowance. You pay tax on all your profits.
What’s the rate?
The rate depends on how much profit your company makes. Smaller profits attract a lower rate, larger profits attract a higher rate, and there’s a marginal rate for profits in between. Check gov.uk for the current thresholds and rates as they do change.
Who pays it?
Any company making a profit, including limited companies, foreign companies with a UK branch, clubs, co-operatives, and some other organisations.
When do you pay?
Corporation Tax is due nine months and one day after the end of your accounting period. Miss the deadline and HMRC can charge interest and penalties.
How do you pay?
First, register your company with HMRC for Corporation Tax. Then file your Company Tax Return and pay what you owe. Most companies do this annually, though very large companies pay in instalments.
Need help with your company’s tax return? Let us handle it for you.
